Siemens and Bimantara form power partnership
Siemens and Bimantara form power partnership
JAKARTA (JP): Siemens AG of Germany and Power Gen. of Britain
will likely join the Bimantara Group in constructing two coal-
fired power generating units in Paiton, East Java, with a
combined capacity of 1,200 megawatts (MW) at a cost of US$2.1
billion.
Kurt W. Pfeiffer, chief representative of Siemens for
Indonesia, told The Jakarta Post yesterday that the government
has given the three business institutions the green light to
establish the units, the second to be awarded to the private
sector at the Paiton power station.
The State Electricity Company (PLN) has operated the first two
units of the station with a combined capacity of 800 MW, while a
consortium of Indonesian-American-Japanese companies will set up
two other units with a total capacity of 1,200 MW.
Pfeiffer said Siemens, Power Gen. and Bimantara Group have
established a consortium to sponsor the construction of the two
power units.
The consortium is 50 percent owned by Siemens, 35 percent by
Power Gen. and 15 percent by the Bimantara Group.
Contract
"I would say that the contract, now under negotiation with the
government, for the construction of the two units will be under a
direct deal," Pfeiffer said.
He added that the consortium was invited by the Ministry of
Mines and Energy on Sept. 22 to present its proposal and clarify
its documents for the project.
If the government approves the proposal, the consortium will
begin negotiations on the design and construction by the end of
this year, he said.
"The construction may start early next year and be completed
in 1997," he said.
Pfeiffer said the consortium will likely sell its electricity
to PLN at the price of some 7.5 U.S. cents per kilowatt hour
(kWh) under a 30-year deal.
By comparison, PT Batu Hitam Perkasa, the consortium which
will set up two other units at Paiton, has agreed with PLN to
sell its electricity at 8.56 U.S. cents per kWh for the first six
years, at 8.41 cents for the next six years, and at 5.54 cents
for the remaining 18 years.
Pfeiffer said his consortium will be able to sell its
electricity at a lower price than Batu Hitam because its
investment will be lower.
Batu Hitam's investment will reportedly reach $2.5 billion.
Regarding local content, Pfeiffer said that his consortium
will be required to use local components for 25 percent of the
construction of its project.
He said Siemens will supply all the main equipment for the
plant, including generators and turbines, while Power Gen. will
be responsible for the design and civil work.
Pfeiffer said his consortium will procure coal from local
companies for the firing system of its power project.
The consortium is now negotiating with five coal producers for
supplying coal for the project.
The state-owned coal mining company PT Tambang Batubara Bukit
Asam operates coal mines in Sumatra, while a number of private
firms operate mines in Kalimantan.
Siemens, in cooperation with Japanese and Indonesian
companies, has also won another power project in Grati, East
Java, with a capacity of 868.5 MW. (fhp)